Unlike equities, many financial asset classes do not trade on an electronic exchange with real-time price discovery and execution, but instead trade in what is referred to as an “over-the-counter” (OTC) market.
Participants in these over-the-counter markets source pricing levels and execute trades primarily via email, telephone and broker websites. As young markets develop and more assets begin trading, the volume of data received—particularly via email—rapidly becomes too large to be efficiently assimilated. In order for traders to discover the best prices, and with whom they should execute the trade, traders must scour through their email inboxes and numerous websites to find the best quotes.
Every day, traders receive huge volumes of pricing data in heterogeneous formats via different media. Without a system for handling that data, much—if not all of it—is effectively useless. Methods, software, and systems by which traders in certain over-the-counter derivatives can identify, organize and store, in real time, heterogeneous pricing data received via email or the web from dealers, would facilitate more efficient trading. Accordingly, methods, software, and systems for determining best prices and trading partners are needed for efficient trading in over-the-counter markets.